Almost a million jobs have been lost since 2007 in sectors such as manufacturing, retail, hotels and restaurants, which traditionally appeal to young people, according to a new study.

Research by the TUC found that finance and business services were the only areas with bigger workforces than before the recession.

Jobs that account for over half of youth employment have suffered the biggest losses, with those in manufacturing falling by 14% over the four years to end of 2011, a cut of over 400,000 posts, said the TUC.

Over 280,000 construction jobs were lost as well as 220,000 in retail, hotels and restaurants. In contrast, employment in finance and business services grew by almost 100,000.

TUC general secretary Brendan Barber said: "The manufacturing sector experienced heavy job losses during the recession and has failed to recover during the UK's admittedly weak recovery. While the retail and construction sectors have gained jobs in the last 12 months, they are still a long way off their pre-recession health.

"A recovery in retail, hotels and restaurants is particularly important for young people as this is where they are most likely to find work. Unfortunately, these jobs are heavily dependent on people's disposable incomes, and falling wages are forcing people to rein in their spending."

Meanwhile, a minister accused the previous Labour government of "hiding" the true scale of youth unemployment and said the coalition was making changes to make jobless figures more "honest".

Employment Minister Chris Grayling also warned that the number of people claiming jobseeker's allowance is likely to increase in the coming months as people switch from other benefits because of the coalition's welfare reforms.

Speaking before new unemployment figures are released on Wednesday, Mr Grayling said that at any one time up to 40,000 young people were on a training scheme under Labour so did not show up on claimant count figures, even though they were still unemployed. Around 1.3 million people were on a training allowance scheme under Labour so they "disappeared" from the jobless register, added Mr Grayling.

A Department for Work and Pensions spokesman said: "This Government is doing everything it can at every level to help young people into meaningful and sustainable work. It is working with business small and large to develop the help and programmes that we believe will help young people across the country."